Ghana's Presidential Candidates Have Been Outlining Plans for The Oil and Gas Sector

Ghana's presidential candidates have been outlining plans for the oil and gas sector, as the nation gears up for a decisive presidential election on December 7.

The People's National Convention candidate, Hassan Ayraiga, said he would review all contracts with oil and gas companies.

"The recent discovery of oil and gas in commercial quantities was greeted with joy and enthusiasm by Ghanaians hoping that their living conditions will change. Unfortunately, three years after oil production, nothing has changed," local media quoted him as saying.

He said existing production agreements were not favorable to the country or its residents, adding that existing agreements would have to be reviewed "to favor Ghanaians."

Ayariga is in the running along with eight other candidates including President Johna Dramani Mahama, who became leader on July 24, following the death of his predecessor, John Atta Mills.

President Mahama said it is important to "strengthen negotiations of what we, as country, get out of our oil resource put in place the the legislative environment that makes the industry predictable and attractive to investors."

Representing the Convention People's Party, Abu Sakara, said Ghana needs to bridge the existing technological gaps that exist in the oil and gas sector and also ensure the passage of a local content law.

He promised to "implement these with a sense of urgency because we cannot be exploring an industry without a framework to govern it."

Ghana's police administration on Wednesday promised the nation and international community an incident-free presidential and parliamentary election, scheduled for December 28.

Ghana became an oil producer in 2010 when the Jubilee field pumped first oil. The field is operated by Tullow Oil with partners Anadarko and state-owned GNPC and South Africa's state-owned PetroSA. Several other companies hold licences for further exploration.

Analysts said that the elections will pose a strong test for Ghana's democratic credentials and that oil will play a part in the voting patterns.

The policies of the next president will determine how the nation's petro-dollars will be spent. If well managed, oil revenues could drive economic growth and confirm Ghana's status as a middle-income nation.

Estimates suggest that foreign exchange earnings from oil production will constitute up to 35% of government revenue when production reaches full potential, roughly equivalent to the amount currently provided by foreign aid.

Ghana says it is determined to avoid the "curse of oil", which has plagued some countries. Its Petroleum Revenue Bill divides earnings into three channels: a stabilization fund to boost economic growth; a heritage fund to be spent when output peaks (starts declining); and the remainder for financing the budget.

The Center for Strategic & International Studies says the bill contains robust monitoring, auditing, and transparency requirements but it remains to be seen whether Ghana has the technical capacity to adequately enforce these provisions. Much will depend on the economic and political decisions made by the government that presides over the oil windfall.