Amid concerns over the value Ghana gets from its natural resources, the government says it is moving to extract more economic value from Ghana’s oil and gas resources by prioritising domestic processing and utilisation.
This signals that rather than relying heavily on exporting crude and importing energy products, the government is aiming at ensuring more value is retained locally.
Energy and Green Transition Minister, Dr John Abdulai Jinapor, says the strategy is aimed at ensuring that Ghana captures more value from the petroleum resources produced within its borders while strengthening the country’s energy security.
He made the disclosure following an engagement with the Ghana Upstream Petroleum Chamber, where he reviewed developments in the upstream petroleum sector and outlined the government’s plans to make the industry more competitive and attractive to investment.
From Exporting Resources to Creating More Value at Home
Dr Jinapor says the government wants to maximise the value of Ghana’s oil and gas by processing and using more of these resources domestically. The approach could mean more of the economic benefits from petroleum production being retained within Ghana through activities such as refining, gas processing, power generation and other industrial uses.
For consumers and businesses, the broader objective is to reduce the disconnect between producing oil and gas locally while still depending on imported energy products to meet domestic needs.
The government therefore sees domestic utilisation as an important part of turning Ghana’s petroleum resources into broader economic benefits.
More Gas for Power, Less Reliance on Imports
According to the Minister, increasing domestic gas production is another major part of the strategy. Dr Jinapor says Ghana needs to increase gas supply to meet growing domestic demand, particularly from the power generation sector.
Reliable gas supply is critical because gas-fired power plants form a significant part of Ghana’s electricity generation mix. More locally produced gas could therefore help power producers reduce their dependence on imported natural gas and other energy products.
For the economy, the potential benefit extends beyond electricity generation. Greater availability of domestic gas could improve energy security, reduce exposure to international energy price shocks and support more predictable power costs.
“Our objective is to maximise the value of the oil and gas produced in Ghana by processing and utilising more of our resources domestically. Increasing gas supply for domestic consumption, especially power generation, will be critical to improving energy security and reducing our dependence on imported natural gas and other energy products,” he noted.
Government Wants Oil Production Back on the Rise
The government is also targeting the decline in Ghana’s oil production. Dr Jinapor says reversing falling crude oil output is high on the government’s agenda, alongside efforts to increase gas production.
Achieving this, however, will require investment, and the government is seeking to create a more attractive environment for upstream petroleum companies.
As part of that effort, the government is reviewing Ghana’s upstream legal and regulatory framework, with the aim of making the sector more competitive and improving investor confidence.
The government is also engaging industry players on their concerns as it works towards a more predictable investment environment.
The Bigger Goal: More Value From Every Barrel
The government’s emerging petroleum strategy is therefore not simply about producing more oil and gas. It is increasingly about what Ghana does with what it produces.
More production, increased domestic processing and greater use of locally produced gas could help Ghana retain more economic value, strengthen energy security and reduce its exposure to imported energy.
Dr Jinapor says achieving these objectives will require a strong partnership between government and industry.
